Crm in Supermarkets

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EB 2003-02 February 2003 FOOD INDUSTRY MANAGEMENT CORNELL U N I V E R S I T Y Customer Relationship Marketing (CRM) in the U.S. Supermarket Industry: Current Status and Prospects Gerard F. Hawkes Senior Extension Associate Food Industry Management Program Department of Applied Economics and Management College of Agriculture and Life Sciences Cornell University, Ithaca, NY 14853-7801 Teaching • Research • Executive Education IT IS THE POLICY OF CORNELL UNIVERSITY actively to support equality of educational and employment opportunity. No person shall be denied admission to any educational program or activity or be denied employment on the basis of any legally prohibited discrimination involving, but not limited to, such…show more content…
Even though the underlying premise of CRM is that loyal customers are less price sensitive, contributing to their potential higher profitability, the major benefit offered by retailers and perceived by consumers in frequent shopper programs is price discounts. While retailers surveyed reported very positive results from their CRM Programs (e.g. increased transactions, shopping frequency, transaction size, overall sales, gross margin, net profit, and return on marketing investment), some of these trends are counterintuitive, perhaps reflecting the misuse of price discounts and other tactics that undermine CRM’s foundation. Fast-paced lifestyles limit the appetite of most consumers for targeted marketing activities, generally, and, the efforts of supermarket and CPG companies, specifically, are perceived as intrusive for most consumers. The importance of customer service cannot be overemphasized in determining the success or failure of retailer CRM programs. All the technology and analytical skills in the world will not prevent poor customer service from driving customers to competitors. At the same time, the critical role of store employee turnover in the success or failure of customer service
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